30050BAH4

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help the reader understand the Company’s financial condition and results of operations. The MD&A is provided as a supplement to, and should be read in conjunction with, our interim consolidated financial statements and the accompanying notes to our interim 30 consolidated financial statements presented in “Part I – Item 1. Financial Statements” of this Form 10-Q; our 2025 Form 10-K, including the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”; and our current reports on Form 8-K filed in 2026. INTRODUCTION Business Overview We are a market leader in connecting care for people with complex conditions like cancer, cardiovascular disease, and musculoskeletal diagnoses. We work on behalf of health plans and other risk-bearing entities and payers (our customers) to support physicians and other healthcare providers (our users) in providing high quality evidence-based care to their patients. We believe adherence to evidence-based clinical pathways supports better outcomes for patients, a better experience for physicians, and lower costs for the healthcare system overall. Specialty care represents a significant and fast-growing portion of healthcare costs in the United States, driven in part by the pace of development of new therapies and treatments. To manage these increasing costs, some health plans and other risk-bearing entities historically deployed cost containment strategies that can limit access to care and operate in narrow silos (for example, prior authorization for radiological studies being considered independently from a comprehensive chemotherapy regimen). We believe Evolent can bring an integrated approach to a patient’s condition across multiple specialties, using technology to recommend our evidence-based clinical pathways in a way that provides rapid feedback to the provider, seeks to remove barriers to care, and aligns financial incentives with the best evidence. We were an early innovator in value-based care, founded in 2011 by members of our management team, UPMC, an integrated delivery system based in Pittsburgh, Pennsylvania, and The Advisory Board Company. All of our revenue is recognized in the United States and substantially all of our long-lived assets are located in the United States. Recent Events Industry Climate During 2024, the medical claims costs in our Performance Suite grew at a significantly faster rate than historical norms, negatively impacting our financial results. This growth was driven in part by higher disease prevalence, as well as higher cost per active patient. Based on commentary from other market participants, we believe these cost increases were industry-wide and not specific to Evolent. Our results for 2025 were also impacted by growth in medical claims cost that continued to grow faster than our historical averages. Changes in Medicaid, and the ACA Health Exchanges, including but not limited to those caused by the passage of the One Big Beautiful Bill Act during 2025, created industry expectations for higher member acuity and lower membership in future years. These expectations are exacerbated by the aggregate medical trends experienced by our customers across all lines of business, which has led those customers to exit markets, adjust their benefits and take other actions that are likely to contribute to lower membership. During the quarter ended June 30, 2026, our customers reported membership declines in Medicaid and Health Exchanges consistent with our expectations. We anticipate exchange membership attrition to continue through the end of the year, though at a decreasing pace. We are unable to predict how these broader dynamics will impact our business and results of operations in the future, but they could continue to impact our financial condition and results of operations and such future impacts could be material. Impact of Inflation We experience pricing pressures in the form of competitive prices in addition to rising costs for certain inflation-sensitive operating expenses such as labor, employee benefits and facility leases. We do not believe these impacts were material to our revenues or net loss for the three and six months ended June 30, 2026. However, significant sustained inflation driven by the macroeconomic environment or other factors could negatively impact our margins, profitability and results of operations in future periods. 31 Customers The following table summarizes those partners who represented at least 10.0% of our consolidated revenue: For the Three Months Ended June 30, For the Six Months Ended June 30, 2026 2025 2026 2025 Highmark 21.8% * 12.4% * Molina Healthcare, Inc. 22.2% 27.2% 23.0% 24.1% Cook County Health and Hospitals System 12.2% 17.4% 13.6% 16.5% Florida Blue * 14.1% 14.5% Aetna 14.4% * 17.1% * Centene Corporation * 11.9% * 11.2% ———————— * Represents less than 10.0% of the respective balance. Segment Reporting We have one operating segment and one reportable segment as our CODM, who is our Chief Executive Officer, assesses the performance of our operations, develops strategy and reviews financial information on a consolidated basis for purposes of evaluating financial performance and allocating resources. Critical Accounting Policies and Estimates Certain GAAP policies that significantly affect the determination of our financial position, results of operations and cash flows, are summarized below. See “Part II - Item 8. Financial Statements and Supplementary Data - Note 2” in our 2025 Form 10-K for a complete summary of our significant accounting policies. Goodwill and Intangible Assets, Net We recognize the excess of the purchase price plus the fair value of any non-controlling interests in the acquiree over the fair value of identifiable net assets acquired as goodwill. Goodwill is not amortized, but is reviewed at least annually for indications of impairment, with consideration given to financial performance and other relevant factors. We perform impairment tests of goodwill at a reporting unit level. We perform impairment tests between annual tests if an event occurs, or circumstances change, that we believe would more likely than not reduce the fair value of a reporting unit below its carrying amount. Our goodwill impairment analysis first assesses qualitative factors to determine whether events or circumstances existed that would lead the Company to conclude it is more likely than not that the fair value of our reporting unit is below its carrying amount. Qualitative factors include macroeconomic, industry and market considerations, overall financial performance, industry, legal and other relevant events and factors affecting the reporting unit. Additionally, as part of this assessment, we may perform a quantitative analysis to support the qualitative factors above by applying sensitivities to assumptions and inputs used in measuring our reporting unit’s fair value. If the Company determines that it is more likely than not that the fair value of our reporting unit is below the carrying amount, a quantitative goodwill assessment is required. In the quantitative evaluation, the fair value is determined and compared to the carrying value. If the fair value is greater than the carrying value, then the carrying value is deemed to be recoverable and no further action is required. If the fair value estimate is less than the carrying value, goodwill is considered impaired for the amount by which the carrying amount exceeds the reporting unit’s fair value and a charge is reported in goodwill impairment on our consolidated statements of operations and comprehensive income (loss). We use a discounted cash flow analysis in order to estimate the fair value of our reporting unit. The discounted cash flow analysis relies on significant judgment and assumptions about expected future cash flows, weighted-average cost of capital, discount rates, expected long-term growth rates and operating margins. These assumptions are based on estimates of future revenue and earnings after considering such factors as general economic and market conditions which drive key assumptions of revenue growth rates, operating margins, capital expenditures and working capital requirements. The weighted average cost of capital is based on market-based factors/inputs but also considers the specific risk characteristics of the reporting unit’s cash flow forecast. A significant change to these estimates and assumptions could cause the estimated fair values of our reporting unit and intangible assets to decline and increase the risk of an impairment charge to earnings. Intangible assets with finite lives are assessed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. 32 See “Part I - Item 1. Financial Statements - Note 8” in this Form 10-Q for more information related to the 2025 goodwill impairment test. As of June 30, 2026, Evolent assessed whether there were events or changes in circumstances that would more likely than not reduce the fair value of its goodwill below its carrying amount and require an interim impairment test. The Company determined there had been no such indicators. Therefore, it was unnecessary to perform a goodwill impairment assessment as of June 30, 2026. RESULTS OF OPERATIONS Evolent Health, Inc. is a holding company and its principal asset is all of the Class A common units in Evolent Health LLC, which has owned all of our operating assets and substantially all of our business since inception. The financial results of Evolent Health LLC are consolidated in the financial statements of Evolent Health, Inc. Key Components of our Results of Operations Revenue Our revenue contracts are typically multi-year arrangements with customers to provide solutions designed to lower the medical expenses of our partners and include our total cost of care management and specialty care management services solutions, provide comprehensive health plan operations and claims processing services, and also include transition or run-out services to customers. Our performance obligation in these arrangements is to provide an integrated suite of services, including access to our platform that is customized to meet the specialized needs of our partners and providers. Generally, we will apply the series guidance to the performance obligation as we have determined that each time increment is distinct. We primarily utilize a variable fee structure for these services that typically includes a monthly payment that is calculated based on a specified per member per month rate, multiplied by the number of members that our partners are managing under a value-based care arrangement or a percentage of plan premiums. Our arrangements may also include other variable fees related to service level agreements, shared medical savings arrangements and other performance measures. Variable consideration is estimated using the most likely amount based on our historical experience and best judgment at the time. We also deploy our services in capitation arrangements under our specialty care management solution, which we call the “Performance Suite.” Capitation arrangements under the Performance Suite may include performance-based arrangements and/or gainshare features. We occasionally use third parties to assist in satisfying our performance obligations. In order to determine whether we are the principal or agent in the arrangement, we review each third-party relationship on a contract-by- contract basis. As we integrate goods and services provided by third parties into our overall service, we control the services provided to the customer prior to its delivery. As such, we are the principal and we will recognize revenue on a gross basis. In certain cases, we act as an agent and do not control the services from third parties before it is delivered to the customer, thereby recognizing revenue on a net basis. Due to the nature of our arrangements, certain estimates may be constrained if it is probable that a significant reversal of revenue will occur when the uncertainty is resolved. We recognize revenue from services over time using the time elapsed output method. Fixed consideration is recognized ratably over the contract term. In accordance with the series guidance, we allocate variable consideration to the period to which the fees relate. Cost of Revenue (exclusive of depreciation and amortization) Our cost of revenue includes direct expenses and shared resources that perform services in direct support of our partners. Costs consist primarily of claims expense, employee-related expenses (including compensation, benefits and stock-based compensation) and other services, as well as other professional fees. In certain cases, our cost of revenue also includes claims and capitation payments to providers and payments for pharmaceutical treatments and other health care expenditures through performance-based arrangements. Selling, General and Administrative Expenses Our selling, general and administrative expenses consist of employee-related expenses (including compensation, benefits and stock-based compensation) for selling and marketing, corporate development, finance, legal, human resources, corporate information technology, professional fees and other corporate expenses associated with these functional areas. Selling, general and administrative expenses also include costs associated with our centralized infrastructure and research and development activities to support our network development capabilities, technology infrastructure, clinical program development and data analytics. Depreciation and Amortization Expense Depreciation and amortization expenses consist of the amortization of intangible assets associated with the step up in fair value of Evolent Health LLC’s assets and liabilities for the Offering Reorganization, amortization of intangible assets recorded as part of our 33 various business combinations and asset acquisitions and depreciation of property and equipment, including internal-use software development costs. Lives on Platform and PMPM Fees Performance Suite Lives on Platform are calculated by summing monthly members covered for specialty care services for contracts not under ASO arrangements divided by the number of months in the period. Specialty Technology and Services Suite Lives on Platform are calculated by summing monthly members covered for oncology, cardiology, musculoskeletal, advanced imaging and other diagnostics specialty care services for contracts under ASO arrangements divided by the number of months in the period. Administrative Services Lives on Platform are calculated by summing monthly members covered for administrative services implementation and core performance services divided by the number of months in the period. Cases are calculated by summing the number of individuals receiving services through our surgery management and advanced care planning programs in a given period. Members covered for more than one category are counted in each category. Performance Suite Average PMPM fee is defined as revenue pertaining to our Performance Suite during the period reported divided by Performance Suite Lives on Platform for the period divided by the number of months in the period. Specialty Technology and Services Suite Average PMPM fee is defined as revenue pertaining to the Specialty Technology and Services Suite during the period reported divided by Specialty Technology and Services Suite Lives on Platform for the period divided by the number of months in the period. Administrative Services Average PMPM fee is defined as revenue pertaining to the Administrative Services during the period reported divided by the Administrative Services Lives on Platform for the period divided by the number of months in the period. Revenue per Case is calculated by the revenue pertaining to surgery management and advanced care planning programs divided by the number of cases for a given period. Average Unique Members are calculated by summing members covered by our Performance Suite, Specialty Technology and Services Suite and Administrative Services. In cases where partners cross between multiple solutions, we only capture members from the solution with the maximum number of members. Management uses Lives on Platform, PMPM fees, Cases, Revenue per Case and Average Unique Members because we believe that they provide insight into the unit economics of our services. We believe that these measures are also useful to investors because they allow further insight into the period over period operational performance. Medical Expense Ratio Medical Expense Ratio (“MER”) is a key performance indicator used by management for purposes of monitoring operating performance and is calculated as GAAP total claims incurred related to our specialty care management services solution divided by GAAP revenue related to our Performance Suite. Management believes MER is useful to investors because it provides insight into the efficiency with which medical costs are managed relative to revenue and helps identify trends in the underlying performance. For periods prior to the consummation of the sale of Evolent Care Partners (“ECP”) in December 2025, we present non-GAAP MER excluding revenues from ECP because is not indicative of ongoing operations. See “Part I - Item 1. Financial Statements - Note 5 - Disaggregation of Revenue” in this Form 10-Q for more information related to GAAP revenue by product type and “Part I - Item 1. Financial Statements - Note 19 in this Form 10-Q for more information related to GAAP total claims incurred. 34 Consolidated Results (in thousands, except percentages) For the Three Months Ended June 30, Change Over Prior Period For the Six Months Ended June 30, Change Over Prior Period 2026 2025 $ % 2026 2025 $ % Revenue $ 652,520 $ 444,328 $ 208,192 46.9% $ 1,148,766 $ 927,977 $ 220,789 23.8 % Expenses Cost of revenue 571,684 343,943 227,741 66.2% 984,156 725,121 259,035 35.7 % Selling, general and administrative expenses 68,831 75,209 (6,378) (8.5)% 141,649 153,618 (11,969) (7.8) % Depreciation and amortization expenses 21,566 23,141 (1,575) (6.8)% 43,121 47,199 (4,078) (8.6) % Loss on lease termination — — — —% — 1,906 (1,906) (100.0) % Change in fair value of contingent consideration — 3,206 (3,206) (100.0)% — 2,926 (2,926) (100.0) % Total operating expenses 662,081 445,499 216,582 48.6% 1,168,926 930,770 238,156 25.6 % Operating loss $ (9,561) $ (1,171) $ (8,390) (716.5)% $ (20,160) $ (2,793) $ (17,367) (621.8) % Cost of revenue as a % of revenue 87.6% 77.4% 85.7% 78.1% Selling, general and administrative expenses as a % of revenue 10.5% 16.9% 12.3% 16.6% Comparison of the Results For the Three Months Ended June 30, 2026 to 2025 Revenue Total revenue increased by $208.2 million, or 46.9%, to $652.5 million for the three months ended June 30, 2026, as compared to 2025. The increase was primarily from $216.8 million of growth in Performance Suite contracts, net of $12.7 million from reductions 35 in membership at certain of our health plan clients due to changes in exchange enrollment, eligibility verification rules and subsidy eligibility for some populations and rate adjustments within certain customer contracts. The following table represents Evolent’s revenue disaggregated by line of business and product type (in thousands): For the Three Months Ended June 30, 2026 2025 Medicaid $ 217,512 $ 193,018 Medicare 225,292 109,042 Commercial and other 209,716 142,268 Total $ 652,520 $ 444,328 Performance Suite $ 484,503 $ 267,917 Specialty Technology and Services Suite 78,161 81,401 Administrative Services 47,989 55,880 Cases 41,867 39,130 Total $ 652,520 $ 444,328 Revenue from Evolent Care Partners — 15,469 Performance Suite revenue excluding revenue from Evolent Care Partners (1) 484,503 252,448 ———————— (1)Performance Suite revenue excluding revenue from Evolent Care Partners is non-GAAP and used in calculating MER excluding Evolent Care Partners. Refer to “Comparison of the Results For the Three Months Ended June 30, 2026 to 2025 - Cost of Revenue” for additional information on MER excluding Evolent Care Partners. The following table represents the Company’s Lives on Platform, Cases, PMPM fees and revenue per case for the three months ended June 30, 2026 and 2025 (Average Lives on Platform/Cases in thousands) by product type: Average Lives on Platform/ Cases Average PMPM Fees / Revenue per Case For the Three Months Ended June 30, For the Three Months Ended June 30, 2026 2025 2026 2025 Performance Suite 6,715 6,490 $ 24.05 $ 13.76 Specialty Technology and Services Suite 75,641 77,019 0.34 0.35 Administrative Services 1,189 1,231 13.46 15.13 Cases 12 13 3,608 2,969 Average Unique Members 39,956 40,201 Cost of Revenue Cost of revenue increased by $227.7 million, or 66.2%, to $571.7 million for the three months ended June 30, 2026, as compared to 2025, principally as a result of the 46.9% increase in our revenue compared to three months ended June 30, 2025. The increase included approximately $238.8 million of higher claims cost compared to the prior year period, which is primarily attributable to new Performance Suite contract go-lives in 2026 and expansion in oncology services to an existing customer offset by $11.4 million from 36 lower personnel costs compared to the prior year driven by reduced headcount and changes to benefits and bonus structure for employees. The following table represents the Company’s MER for its specialty care management services solution: For the Six Months Ended June 30, 2026 2025 Total claims incurred related to our specialty care management services solution(1) $ 461,520 $ 214,247 Performance Suite revenue 484,503 267,917 Performance Suite revenue excluding revenue from Evolent Care Partners (2) 484,503 252,448 MER 95.3 % 80.0 % MER excluding Evolent Care Partners (3) 95.3 % 84.9 % ———————— (1)Refer to the discussion in “Part I - Item 1. Financial Statements - Note 19” for additional information on total claims incurred. (2)Refer to “Comparison of the Results For the Three Months Ended June 30, 2026 to 2025 - Revenue” for additional information on Non-GAAP Performance Suite revenue less revenue from Evolent Care Partners. (3)Refer to “Key Components of our Results of Operations - Medical Expense Ratio” for additional information on Non-GAAP MER excluding Evolent Care Partners. The increase in MER and MER excluding Evolent Care Partners for the three months ended June 30, 2026 compared to 2025 is driven primarily by the go-live of Performance Suite contracts during the first half of 2026. Approximately $0.7 million and $1.1 million of total cost of revenue was attributable to stock-based compensation expense for the three months ended June 30, 2026, and 2025 respectively. Cost of revenue represented 87.6% and 77.4% of total revenue for the three months ended June 30, 2026, and 2025 respectively. Our cost of revenue increased as a percentage of our total revenue due to higher medical expenses from our new Performance Suite contracts. We anticipate continued growth in the cost of treatment for cancer and cardiovascular patients over time, which we expect to be offset by contractual protections within our Performance Suite and the impact of our clinical interventions. Selling, General and Administrative Expenses Selling, general, and administrative expenses decreased by $6.4 million, or 8.5%, to $68.8 million for the three months ended June 30, 2026, as compared to 2025. The decrease was primarily driven by lower personnel costs of $4.7 million from reduced headcount and changes to benefits and bonus structure for employees and lower severance of $0.5 million, lower professional fees of $3.2 million due primarily to the ECP disposition in December 2025 and technology services of $1.7 million due primarily to a change in services received from certain vendors, offset by higher stock compensation of $4.0 million due to the achievement and change in projected achievement of certain performance measurements. Approximately $14.5 million and $10.5 million of total selling, general and administrative costs were attributable to stock-based compensation expense for the three months ended June 30, 2026, and 2025, respectively. Acquisition and severance costs accounted for $0.8 million of total selling, general and administrative expenses for both the three months ended June 30, 2026 and 2025, respectively. Selling, general and administrative expenses represented 10.5% and 16.9% of total revenue for the three months ended 37 June 30, 2026, as compared to 2025, respectively, driven primarily from contractual updates with certain customers in our Performance Suite. Depreciation and Amortization Expenses Depreciation and amortization expenses decreased $1.6 million, or 6.8%, to $21.6 million for the three months ended June 30, 2026, as compared to 2025 due primarily due to $0.3 million of lower depreciation on computer hardware, $0.7 million of lower amortization on ECP provider network contracts which was sold in December 2025 and $0.6 million lower amortization of certain customer relationships and technology intangibles reaching their useful life. Depreciation and amortization expenses include $12.5 million and $13.4 million for the three months ended June 30, 2026, as compared to 2025, of amortization expense on intangible assets such as corporate trade names, customer, relationships, provider network contracts and existing technology related to acquisitions and business combinations. Change in Fair Value of Contingent Consideration We recorded a loss on change in fair value of contingent consideration of $3.2 million for the three months ended June 30, 2025 primarily related to our Machinify earnout. Comparison of the Results For the Six Months Ended June 30, 2026 to 2025 Revenue Total revenue increased $220.8 million, or 23.8%, to $1,148.8 million for the six months ended June 30, 2026, compared to the same period in 2025. The increase was driven primarily by $339.8 million from new Performance Suite contract go-lives and expanded oncology services during the six months ended June 30, 2026 offset by a reduction of $73.1 million from the ECP disposition and $44.2 million from reductions in membership at certain of our health plan clients due to changes in exchange enrollment, eligibility verification rules and subsidy eligibility for some populations and rate adjustments within certain customer contracts. The following table represents Evolent’s revenue disaggregated by line of business and product type (in thousands): For the Six Months Ended June 30, 2026 2025 Medicaid $ 435,626 $ 381,142 Medicare 388,102 224,360 Commercial and other 325,038 322,475 Total $ 1,148,766 $ 927,977 Performance Suite (1) $ 807,806 $ 570,938 Specialty Technology and Services Suite 158,960 164,222 Administrative Services 97,576 113,071 Cases 84,424 79,746 Total $ 1,148,766 $ 927,977 Revenue from Evolent Care Partners — 73,268 Performance Suite revenue excluding revenue from Evolent Care Partners(2) $ 807,806 $ 497,670 ———————— 38 (1)Performance Suite revenue excluding revenue from Evolent Care Partners is non-GAAP and used in calculating MER excluding Evolent Care Partners. Refer to “Comparison of the Results For the Six Months Ended June 30, 2026 to 2025 - Cost of Revenue” for additional information on MER excluding Evolent Care Partners. The following table represents the Company’s Lives on Platform/ Cases, Average PMPM fees, Revenue per Case and Average Unique Members (Average Lives on Platform/Cases in thousands) by product type: Average Lives on Platform/ Cases Average PMPM Fees / Revenue per Case For the Six Months Ended June 30, For the Six Months Ended June 30, 2026 2025 2026 2025 Performance Suite 6,396 6,488 $ 21.05 $ 14.66 Specialty Technology and Services Suite 75,871 77,049 0.35 0.36 Administrative Services 1,154 1,222 14.10 15.42 Cases 23 27 3,689 2,953 Average Unique Members 39,429 40,415 Cost of Revenue Cost of revenue increased by $259.0 million, or 35.7%, to $984.2 million for the six months ended June 30, 2026, as compared to 2025, principally as a result of the 23.8% increase in our revenue compared to the six months ended June 30, 2025. The increase included approximately $286.5 million of higher claims cost compared to the prior year period, which is primarily attributable to $355.9 million higher claims expense from new and existing Performance Suite contracts, offset by a decrease of $59.3 million of claims from the disposition of ECP in December 2025 and transitioning certain Performance Suite customers to Specialty and Technology Service Suite and narrowing of scope of certain customers totaling $9.2 million and lower personnel costs of $21.2 million compared to the prior year driven by decreased headcount and change in bonus and benefits structure for certain employees. The following table represents the Company’s MER for its specialty care management services solution: For the Six Months Ended June 30, 2026 2025 Total claims incurred related to our specialty care management services solution(1) $ 763,297 $ 420,239 Performance Suite revenue 807,806 570,938 Performance Suite revenue excluding revenue from Evolent Care Partners (2) 807,806 497,670 MER 94.5 % 73.6 % MER excluding Evolent Care Partners (3) 94.5 % 84.4 % ———————— (1)Refer to the discussion in “Part I - Item 1. Financial Statements - Note 19” for additional information on total claims incurred. (2)Refer to “Comparison of the Results For the Six Months Ended June 30, 2026 to 2025 - Revenue” for additional information on Non-GAAP Performance Suite revenue less revenue from Evolent Care Partners. (3)Refer to “Key Components of our Results of Operations - Medical Expense Ratio” for additional information on Non-GAAP MER excluding Evolent Care Partners. The increase in MER and MER excluding Evolent Care Partners for the six months ended June 30, 2026 compared to 2025 is driven primarily by the go-live of two Performance Suite contracts during the first half of 2026. Approximately $1.2 million and $1.7 million of total cost of revenue was attributable to stock-based compensation expense for the six months ended June 30, 2026, and 2025, respectively. Cost of revenue represented 85.7% and 78.1% of total revenue for the six months ended June 30, 2026, and 2025, respectively. Our cost of revenue increased as a percentage of our total revenue due to the maturation profile of two new Performance Suite contracts that went live during the first half of 2026. We anticipate continued growth in the cost 39 of treatment for cancer and cardiovascular patients over time, which we expect to be offset in part by contractual protections within our Performance Suite and the impact of our clinical interventions. Selling, General and Administrative Expenses Selling, general, and administrative expenses decreased by $12.0 million, or 7.8%, to $141.6 million for the six months ended June 30, 2026, as compared to 2025. The decrease was primarily driven by lower personnel costs of $8.9 million from reduced headcount and change to the 2026 benefits and bonus structure for certain employees and decreased severance of $1.5 million and lower professional fees of $6.0 million driven by the ECP disposition in December 2025 offset by higher stock compensation expense due to the achievement and change in projected achievement of certain performance measurements of $3.7 million and a $0.8 million increase in bad debt expense versus the prior period reflecting a return to normal collections timing. Approximately $24.6 million and $21.0 million of total selling, general and administrative expenses were attributable to stock-based compensation expense for the six months ended June 30, 2026 and 2025, respectively. Acquisition and severance costs accounted for approximately $1.3 million and $2.5 million of total selling, general and administrative expenses for the six months ended June 30, 2026 and 2025, respectively. Selling, general and administrative expenses represented 12.3% and 16.6% of total revenue for the six months ended June 30, 2026, as compared to 2025, respectively, driven primarily from contractual updates with certain customers in our Performance Suite. Depreciation and Amortization Expenses Depreciation and amortization expenses decreased $4.1 million, or 8.6%, to $43.1 million, for the six months ended June 30, 2026, as compared to 2025 primarily due to $0.7 million of lower depreciation on computer hardware and $0.3 million of lower depreciation of internally developed software, $1.3 million of lower amortization on ECP provider network contracts which was sold in December 2025 and $1.3 million lower amortization of certain customer relationships and technology intangibles reaching their useful life. Depreciation and amortization expenses include $25.0 million and $26.7 million for the six months ended June 30, 2026 and 2025, respectively, of amortization expense on intangible assets such as corporate trade names, customer, relationships, provider network contracts and existing technology related to acquisitions and business combinations. Loss on Lease Termination During the year ended December 31, 2024, the Company terminated its Chicago, IL lease effective October 31, 2024. We recorded an additional $1.9 million loss on lease termination related to negotiated termination payments and real estate commissions during the six months ended June 30, 2025. Change in Fair Value of Contingent Consideration We recorded a loss on change in fair value of contingent consideration of $2.9 million for the six months ended June 30, 2025 primarily related to our Machinify earnout. Discussion of Non-Operating Results Interest Expense We recorded interest expense (including amortization of deferred financing costs) of $16.9 million and $33.7 million for the three and six months ended June 30, 2026, respectively, and $11.6 million and $22.0 million for the three and six months ended June 30, 2025, respectively. The increase in interest expense for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 is driven primarily by interest incurred under First Lien Credit Agreement borrowings in January 2025 and the exchange of our Series A Preferred Stock for Second Lien Loan Facility combined with the issuance of our 2031 Notes in August 2025. See “Part I - Item 1. Financial Statements - Note 9” in this Form 10-Q for more information related to interest expense by debt issuance. Extinguishment of Series A Preferred Stock On June 19, 2025, the Company entered into Amendment No. 5 which provided, in part, that failure to consummate the Exchange of our Series A Preferred Stock for new Second Lien Term Loans in certain circumstances will constitute an event of default under the First Lien Credit Agreement. Amendment No. 5 was accounted for as an extinguishment and reissuance of the Series A Preferred Stock. The Series A Preferred Stock post-amendment was recorded at fair value, including a $9.0 million charge to extinguishment of Series A Preferred Stock on the consolidated statement of operations and comprehensive income (loss) and the remainder as a deemed dividend. 40 Loss on Option Exercise During the year ended December 31, 2025, we completed the purchase of a portion of one of our equity method investments that we did not own from our joint venture partner for the price of $51.5 million. The purchase price was fixed based on a previously negotiated put/call structure. The loss of $52.5 million represents the difference between the purchase price under the put option and the estimated fair value of the interests acquired. The joint venture was primarily focused on a portfolio of oncology clinics, a member navigation platform and practice alignment arm. The oncology clinics in the joint venture were shut down or otherwise disposed of prior to the payment of the put option, and the joint venture will have no continuing operations. Provision for Income Taxes An income tax provision for (benefit from) of $2.7 million and $3.6 million for the three and six months ended June 30, 2026, respectively, and $(0.8) million and $0.6 million for the three and six months ended June 30, 2025, respectively, which resulted in effective tax rates of (10.6)% and (7.1)% for the three and six months ended June 30, 2026, respectively, and 4.0% and (0.8)% for the three and six months ended June 30, 2025, respectively. The income tax expense recorded during both the three and six months ended June 30, 2026 and 2025, primarily relates to the change in the valuation allowance, non-deductible expenses and state and foreign taxes. Dividends and Accretion of Series A Preferred Stock Including Excise Tax During the year ended December 31, 2025, the Company completed the exchange of its existing Series A Preferred Stock for the new Second Lien Term Loan Facility on substantively similar economic terms to the existing Series A Preferred Stock, with no common stock conversion feature. Prior to the Exchange, we paid quarterly regular cash dividends during 2025 on the Series A Preferred Stock at a rate per annum equal to Adjusted Term SOFR (as defined in the Certificate of Designation) plus 6.00%. Prior to the Exchange, the Company accreted redemption value in excess of par at a redemption price per share equal to 150.00% of the then-current liquidation preference per share of the Series A Preferred Stock. The Company paid dividends and recorded accretion of deferred issuance costs and redemption value related to the Series A Preferred Stock as presented below (in thousands): For the Three Months Ended June 30, For the Six Months Ended June 30, 2026 2025 2026 2025 Cash dividends on Series A Preferred Stock $ — $ 4,621 $ — $ 9,198 Accretion of deferred financing costs and redemption value in excess of par excluding extinguishment of Series A Preferred Stock — 26,572 — 29,627 Dividends and accretion of Series A Preferred Stock $ — $ 31,193 $ — $ 38,825 REVIEW OF CONSOLIDATED FINANCIAL CONDITION Liquidity and Capital Resources The Company reported net loss attributable to common shareholders of Evolent Health, Inc. of $55.0 million and $123.3 million for the six months ended June 30, 2026 and 2025, respectively. As of June 30, 2026, the Company had $115.7 million of cash and cash equivalents and $25.8 million in restricted cash. We believe our current cash and cash equivalents will be sufficient to meet our working capital and capital expenditure requirements for at least the next twelve months as of the date the financial statements were issued. Our future capital requirements will depend on many factors, including our rate of revenue growth, the expansion of our sales and marketing activities and the timing and extent of our spending to support our investment efforts and expansion into other markets. We may also seek to invest in, or acquire complementary businesses, applications or technologies, which may require us to seek sources of financing. 41 Cash Flows The following summary of cash flows (in thousands) has been derived from our financial statements included in “Part I - Item 1. Financial Statements - Consolidated Statements of Cash Flows”: For the Six Months Ended June 30, 2026 2025 Net cash and restricted cash used in operating activities $ (10,296) $ (25,769) Net cash and restricted cash used in investing activities (13,105) (73,624) Net cash and restricted cash (used in) provided by financing activities (14,966) 98,927 Operating Activities Cash flows from operating activities primarily represent inflows and outflows associated with our operations. Primary activities include net loss from operations adjusted for non-cash transactions, working capital changes and changes in other assets and liabilities. Cash flows used in operating activities of $10.3 million for the six months ended June 30, 2026 were driven primarily by an overall increase in reserve for claims and performance-based arrangements of $186.2 million offset in part by increases in accounts receivable of $139.3 million, both primarily driven by new Performance Suite contract go-lives in 2026 and timing of claims, customer settlements and reconciliations, decreases in accrued liabilities of $22.3 million from timing of customer settlements, our partner and vendor payments and accrued compensation and benefits of $22.0 million due to the changes to benefits and bonus structure for employees. Cash flows used in operating activities of $25.8 million for the six months ended June 30, 2025 were driven primarily by $67.5 million in payments to clients for reconciliations of performance suite contracts from prior years; these contracts have since been restructured. This was included in an overall reduction in reserve for claims and performance-based arrangements of $131.5 million due to the timing of claims payments, offset in part by decreases in accounts receivable of $55.9 million from timing of our partner and vendor payments and an increase in accrued compensation and benefits of $4.5 million due to the timing of 2024 bonus payments and severance of $1.8 million. Investing Activities Cash flows used in investing activities of $13.1 million for the six months ended June 30, 2026 were primarily related to investments in internal-use software and purchases of property and equipment. Cash flows used in investing activities of $73.6 million for the six months ended June 30, 2025 were primarily attributable to cash paid for asset acquisitions and business combinations of $56.0 million and investments in internal-use software and purchases of property and equipment of $17.4 million. Financing Activities Cash flows used in financing activities of $15.0 million for the six months ended June 30, 2026 were primarily related to a $10.0 million repayment of our Revolving Facility. Cash flows provided by financing activities of $98.9 million for the six months ended June 30, 2025 were primarily related to $221.0 million of borrowings under our Term Loan Facility, offset, in part by $62.5 million of repayments under our Revolving Facility, $44.8 million related to changes in working capital balances related to claims processing and $9.2 million of preferred dividends paid on our Series A Preferred Stock. Contractual and Other Obligations We believe that the amount of cash and cash equivalents on hand and cash flows from operations, plus borrowings under our credit facilities and if necessary, additional funding through other forms of financing, will be adequate for us to execute our business strategy and meet anticipated requirements for lease obligations, capital expenditures working capital and debt service for the next twelve 42 months and in the long-term. Our estimated known contractual and other obligations (in thousands) as of June 30, 2026, were as follows (including as discussed in the narrative below): 2026 2027-2028 2029-2030 2031+ Total Operating leases for facilities $ 952 $ 2,119 $ 1,455 $ 114 $ 4,640 Purchase obligations related to vendor contracts 8,887 13,882 2,616 — 25,385 Convertible notes interest payments (1) 10,796 43,183 29,095 7,504 90,578 Convertible notes principal repayment — — 402,500 166,750 569,250 Total $ 20,635 $ 59,184 $ 435,666 $ 174,368 $ 689,853 ———————— (1)Refer to the discussion in “Part I - Item 1. Financial Statements - Note 9” for additional information on payment dates for our convertible notes interest. As of June 30, 2026, there was $117.2 million, $62.5 million and $175.0 million principal balance subject to interest under the Company’s Term Loan Facility, Revolving Facility and Second Lien Term Loan Facility, respectively, all of which are subject to interest rates based on the SOFR. The interest rate for all Loans will be calculated, at the option of the borrowers, (a) in the case of the Revolving Facility, at either the Adjusted Term SOFR plus 4.00%, or the base rate plus 3.00% and (b) in the case of the Term Loan Facility, at either the Adjusted Term SOFR plus 5.50% or the base rate plus 4.50%, subject to step downs based on a total secured leverage ratio. The Company used the funds borrowed under its Committed Facilities for general corporate purposes, including working capital and management of future liabilities. The interest rate for the Second Lien Term Loan will be calculated (a) in the case of loans that bear interest at ABR, 5.00% plus the ABR and (b) in the case of Term SOFR Loans, 6.00% plus the relevant Adjusted Term SOFR Rate, in each case subject to step downs based on a total secured leverage ratio. All loans under the First Lien Credit Agreement will mature on the date that is the earliest of (a) December 6, 2029, (b) the date on which all commitments are voluntarily terminated or amounts outstanding under the First Lien Credit Agreement have been declared or have automatically become due and payable under the terms of the First Lien Credit Agreement, (c) the date that is one hundred eighty (180) days prior to the maturity date of the Company’s Convertible Senior Notes due 2029 and (d) the date that is ninety-one (91) days prior to the maturity date of any other Junior Debt (as defined in the First Lien Credit Agreement) unless certain liquidity conditions are satisfied. All loans under the Second Lien Credit Agreement will mature on the date that is the earliest of (a) December 6, 2029, (b) the date on which all amounts outstanding under the Second Lien Credit Agreement have been declared or have automatically become due and payable under the terms of the Second Lien Credit Agreement, (c) the date that is one hundred eighty (180) days prior to the maturity date of the Company’s Convertible Senior Notes due 2029 and (d) the date that is ninety-one (91) days prior to the maturity date of any other Junior Debt (as defined in the Second Lien Credit Agreement) unless certain liquidity conditions are satisfied. Accounts Receivable, Net Accounts receivable are recorded and carried at the original invoiced amount less an allowance for any potential uncollectible amounts. During the six months ended June 30, 2026, accounts receivable, net, increased primarily due to the timing of cash receipts from certain customers. Restricted Cash As of June 30, 2026, there was restricted cash of $25.8 million is carried at cost and includes cash held on behalf of other entities for claims processing services of $9.8 million, collateral for letters of credit required as security deposits for facility leases of $0.2 million, and amounts held with financial institutions for risk-sharing arrangements of $15.8 million. See “Part I - Item 1. Financial Statements - Note 2” for further details of the Company’s restricted cash balances. Uses of Capital Our principal uses of cash are in the operation and expansion of our business, payment of interest and other amounts payable in connection with financings, including on our convertible debt and secured borrowings, as well as potential tax obligations. The Company does not anticipate paying a cash dividend on our Class A common stock in the foreseeable future. 43